The trillion-dollar consumption tax reform is coming! Consumption tax will be levied in an expanded scope! The consumption tax has increased again, and residents' consumption may be more rational~
The tax revenue of land transfer and real estate in various places has continued to decline sharply, resulting in a sharp decline in local fiscal revenue, and tax reform is about to come out~
On June 25, entrusted by the State Council, the Audit Office made the "Report of the State Council on the Audit of the Implementation of the Central Budget and Other Financial Revenues and Expenditures in 2023" to the 10th meeting of the Standing Committee of the 14th National People's Congress.
Since then, the national trillion-level consumption tax reform is about to be implemented.
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The trillion-dollar consumption tax reform includes the following major features:
The consumption tax will expand the scope of collection of consumer goods
Consumption tax is an important tax to adjust the product structure and consumption direction, and the expansion of its collection scope will significantly increase the national tax revenue.
According to data from the Ministry of Finance, in 2023, the scale of national consumption tax revenue will reach 1.61 trillion yuan, accounting for 8.9% of the overall tax revenue, second only to value-added tax (38.3%) and corporate income tax (22.7%).
Next, the consumption tax reform may take the lead in including high-end consumer goods, luxury accessories, high-end services, and some goods that are not currently included in the scope of consumption tax into the new consumption tax items; It can directly increase the tax source and provide more fiscal revenue for local governments.
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The consumption tax reform will be moved back to the collection link
At present, the consumption tax on the mainland is mainly levied in the production of consumer goods, which limits the tax revenue of local governments to a certain extent.
After the consumption tax reform, the collection of consumption tax will be moved to the wholesale or retail link, so that the attribution of tax sources will be shifted from the place of production to the place of consumption, thereby increasing the tax revenue of local governments.
This measure will effectively improve the efficiency of tax collection and reduce the link of tax collection and administration.
At the same time, this will enhance the price transparency of consumer goods and make consumers more intuitive to understand the amount of consumption tax in goods.
Shifting the excise tax collection of major consumer goods such as cigarettes, refined oil products and automobiles from the production end to the retail end could lead to significant tax revenue growth.
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For example, in 2015, for example, this reform will increase tax revenue by an additional 71.7 billion yuan, accounting for 6.8% of the consumption tax revenue that year. If the consumption tax revenue of 1.61 trillion yuan in 2023 is used as the base, the above increase may lead to a larger tax increment.
However, as a result, there may be a loss of tax sources in the production areas of consumer goods and a widening gap in financial resources between regions, which will need to be balanced by a supporting transfer payment system.
Consumption tax will be steadily transferred to local governments and local tax revenues will be increased
Previously, consumption tax was a tax directly collected by the central government, and all its revenue was attributed to the central government. Steady decentralization of local governments will help enhance the tax revenue, financial resources and autonomy of local governments.
By attributing part of the consumption tax revenue to local finance, local governments can be encouraged to improve the consumption environment and promote the transformation and upgrading of the industrial structure.
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Due to the impact of the sharp decline in land revenue, the fiscal tightening of local governments and the natural limitation of fiscal expenditure; After the tax reform, local governments will have more financial resources to spend on areas such as public services and social security.
It should be pointed out that this move may lead to local governments becoming overly dependent on consumption tax revenues, which will increase the burden on business operators and affect business operations.
Residents' consumption continues to be sluggish, and the increase in consumption tax will increase the burden on residents and lead to even more sluggish consumption!
It is worth mentioning that the current downturn in the real estate market has led to a sharp decline in land revenue from local governments, and the consumer tax reform will make up for this gap.
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However, the scope of consumption tax will be expanded, the tax collection of consumer goods will be transferred to wholesale and retail sales, and the consumption tax will be transferred to local governments. It will inevitably increase the tax burden on ordinary consumers, especially on high-spending groups.
The key is that the current downgrading of household consumption, and the continued downturn in the consumer market, and the expansion of the scope of consumption tax and other reform measures may lead to the intensification of the downturn in household consumption and increase the difficulties of business operations...
Expand the scope of taxation of consumer goods! The tax burden of residents' consumption will increase, and consumption may be more rational~